The international consulting agency Cushman & Wakefield, based on the data collected, estimates the value of transactions in the commercial real estate market in the first half of 2024 to reach 1.76 billion EUR. This represents a nearly 80% rise compared to the first half of 2023. There is a noticeable upswing in the market among funds, including investors with Polish capital, and according to forecasts by Cushman & Wakefield, this year may close with an investment volume valued at 4 billion EUR.
The first half signifies a clear rebound in the commercial real estate sector, with more than 1.7 billion EUR in investment transactions marking nearly an 80% rise year-on-year and more than 50% increase compared to the same period in 2022. The capital market’s good performance is the result of falling interest rates and better economic sentiment, which further motivates buyers to invest in real estate. Polish investors are filling the niche for smaller sales contracts, not only investing in development projects but also in ready-made commercial projects, commented Krzysztof Misiak, Managing Director of Cushman & Wakefield in Poland.
The first half of 2024 saw significant capital engagement from the UK, accounting for 35% of the volume (primarily as part of a large transaction). The market also continues to see a strong position of investors from the Czech Republic (19%) as well as increasing involvement from the aforementioned domestic capital and players from Scandinavia – both these groups of investors were responsible for approximately 9% of finalized transactions.
The past year is still dominated by value-add transactions, with the market showing the first core+ deals. We forecast this year’s investment volume to reach 4 billion EUR, achieving almost double growth compared to 2023 and 75% of the 5-year average, adds Paweł Partyka, Head of Capital Markets Poland, Cushman & Wakefield.
According to Cushman & Wakefield, the investment volume in the office market exceeded 800 million EUR by the end of June. Office asset agreements saw a fourfold year-on-year increase, with the most buying activity occurring in the second quarter. The Polish office market, which remains the market leader in Central and Eastern Europe in terms of scale, quality, and product diversification from this segment, confirms its strong fundamentals.
Trends suggest that the real estate market awaits the introduction of REIT (Real Estate Investment Trust) structures, which are popular in mature markets like USA, Canada, the UK, France, or Spain. These dividend funds are one of the main elements of property investing, and their capitalization exceeds 600 billion USD in the USA, 57 billion EUR in the UK, and nearly 50 billion EUR in France.
Cushman & Wakefield believes REITs enable an alternative way of long-term saving and investing for individual investors and create a compelling opportunity for pension funds and insurers. Experienced market players, developers, and real estate consultants’ participation and creating a reward system dependent on shareholders’ relevant effect, income, will be key success factors for REIT projects.
Source: https://ceo.com.pl/rynek-nieruchomosci-komercyjnych-w-polsce-rosnie-o-80-r-r-inwestycje-przekroczyly-176-mld-eur-w-pierwszym-polroczu-2024
